The judges noted that the Kerala Bank had already waived the loans of the victims who suffered due to the landslides and added that the bank’s total financial exposure in the matter was around Rs.5 crore.
Kochi, April 10: The Kerala High Court said on Thursday that while the Reserve Bank of India (RBI) cannot directly ask banks to waive the loans of the people affected by the Wayanad landslides, the Union Government and the National Disaster Management Authority (NDMA) have the authority to do so.
The court bench, comprising Justices A K Jayasankaran Nambiar and Easwaran S, said it will soon issue official directions to the Central Government and the NDMA, encouraging them to take steps to persuade banks to waive the loans.
“It only requires a bit of goading from the NDMA and the Union government,” the High Court observed.
The judges noted that the Kerala Bank had already waived the loans of the victims who suffered due to the landslides and added that the bank’s total financial exposure in the matter was around Rs.5 crore. The court said this shows that if one bank can take such a humanitarian step, other banks should also be able to do the same, especially if their financial exposure is smaller.
“If the Kerala Bank can do it, then the other banks, which have lesser exposure, can also do the same,” the bench observed.
The court made these comments while discussing the affidavit submitted by the Central Government earlier this week. In the affidavit, the government said that according to the RBI’s Master Directions on Natural Calamities, banks are only allowed to restructure or reschedule loans in such disaster cases. That means the RBI rules don’t permit an outright loan waiver.
Responding to this, the High Court stated that although RBI has no power to waive loans, the NDMA and Union Government have the capability to influence banks and encourage them to help the disaster victims.
Apart from the loan issue, the court also gave strict instructions to the Kerala State Government. It asked the state to take all necessary steps to prevent a repeat of such disasters, especially with the monsoon season approaching. This includes cleaning up debris and making the area safe.
“Preparatory measures should start before the monsoons. It has already started raining now. The NDMA should liaise with the State Disaster Management Authority (SDMA) to avert any possible disaster this year,” the High Court said.
Earlier, The Kerala High Court requested the Central government to reconsider its demand for Rs 132 crore as airlift charges for Indian Air Force (IAF) rescue operations conducted in the state since 2006. The court suggested excluding Rs 120 crore from the total, enabling the state to allocate the funds for rehabilitating victims of the devastating Wayanad landslides.
A division bench comprising Justices AK Jayasankaran Nambiar and Easwaran S emphasized the urgency of the situation, noting that the release of Rs 120 crore could immediately boost available resources for relief efforts.
The court remarked that the Rs 132 crore bill from the Defence Ministry, issued shortly after Kerala requested financial aid for Wayanad rehabilitation, appeared to be a “psychological move.” It stressed that the request was made for a noble cause, as the funds are critical for disaster relief.
This case is being heard as part of a Public Interest Litigation (PIL) that the Kerala High Court had started on its own. The court initiated this PIL after the massive landslide that struck Wayanad last year.
The landslide, which happened on July 30, 2024, caused heavy destruction in the Mundakkai and Chooralmala areas of Wayanad. The disaster killed over 200 people, injured hundreds, and left 32 persons still missing. The court wants to ensure that the state takes strong steps to improve its disaster management system and protect the lives of people, especially in vulnerable areas like Wayanad.
